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The government imposes several control on such products in order to protect the interest of consumers.

When the product of one producer is to be easily identified from that of products of other producers and no one else can copy it by using name, logo, number, design on the label, etc. it is known as branding.

1. Sujith’s argument is correct. 

2. Marketing and selling are different.

The differences between marketing and selling are

Techniques of Sales Promotion 

(1) Rebate :

Offering products at special prices, to clear o excess inventory. 

(2) Discount:

Offering products at less than maximum retail price.

(3) Refund:

The seller offers to refund a part of the price paid by the customer on production of some proof of purchase. 

(4) Free gifts :

Offering another product as gift along with the purchase of a product. 

(5) Quantity Gift:

Offering extra quantity of the product.

(6) Contests :

Prize contests are organized for the consumers and winners are given attractive prizes. 

(7) Money refund:

There are certain manufacturers who promise to refund the price of the product, if it does not satisfy the consumer. 

(8) Samples:

Offer of free samples of a product to customers at the time of introduction of a new product.

Product, Price, Place and Promotion.

Once the samples of a particular product reach to the consumers through sales promotion, the advertisement of the same product gets more effective.

When the producer gets the brand name and logo registered with government so that no other company can copy it or use it than such a legal certification is called trademark.

Taste and preference of the consumer, number of consumers, purchasing power of consumer, number of competitors in the market, price of competitor’s product, etc.

Amitha’s argument is logical. Selling comes under marketing.

(a) Promotion

Price, Promotion

Difference between Personal Selling and Advertising

(a) Production cost and
(b) Demand for the product

Advertising is done through identified sponsor.

Personal selling is paid form of personal communication

Sales promotion activities are short term incentives offered to customers.

Public relations is a non sales communication.

Factors Affecting Price Determination:

1. Product Cost:

One of the most important factors affecting price of a product or service is its cost of production and distribution. Fixed Costs, Variable Costs and Semi- Variable Costs are to be considered for determining the price.

2. Demand: 

The price of a product is affected by the elasticity of demand of the product. If the demand of a product is inelastic, the rm is in a better position to x higher prices.

3. Competition:

Competitors’ prices and their anticipated reactions must be considered before fixing the price of a product. In case of high competition, it is desirable to keep price low.

4. Government and Legal Regulations:

In order to protect the interest of public against unfair practices, prices of some essential products are regulated by the government under the Essential Commodities Act.,

e.g. Medicines.

5. Pricing Objectives: 

Another important factor affecting the fixation of price of a product is pricing objectives,

e.g. maximisation of profit, market share, etc.

Factors affecting the price of a product are the following:

i. Demand for Product: Intensive study of demand for product and services in the market be undertaken before price fixation. If demand is relatively more than supply, higher price can be fixed.

ii. Price of Competing Firms: It is necessary to take into consideration prices of the products of the competing firms prior to fixing the price. In case of cut-throat competition it is desirable to keep prices low.

The factors affecting pricing decisions can be classified into two categories as under:

Internal Factors: These are controllable factors that exist within the company’s environment. They are:

1. Business Objectives: The pricing decision should always be in accordance with the business objectives like growth an expansion and customer satisfaction. 

2. Cost of the product: This is the most important factor that determines the pricing decision. The price = Cost + profit. Thus the price for the product or service should cover the entire cost to the manufacturer as well as reasonable profits. 

3. Quality of the product: High-quality products give rise to higher costs and demands for higher prices. But low-quality products give rise to low cost and reduces the price.

4. Marketing Mix: The other elements of the marketing mix also influence the pricing decisions. If the other elements ail well co-ordinate, even a high-priced product can be sold easily. 

5. Product differentiation: If a business concern differentiates its products from that of the competitors in terms of style, design, color, package, etc., it can change its prices easily than a firm that is too rigid in its product.

External Factors: These are the uncontrollable factors that exist outside the company’s environment. They are:

1. Elasticity of demand: A product that has inelastic demand, higher price may be fixed for that product. But if the demand for the product is elastic the price of the product must be kept flexible.

2. Pricing policy of competitors: The number of competitors and pricing strategies also will have a bearing on the pricing decisions of a concern.

3. Distribution channels: A lengthy distribution channel demands for higher price. On the other hand, a shorter distribution channel reduces the price of the product. 

4. Government policy: The government policies regarding certain products influence the pricing decision of the concern. Accordingly, price needs to be adjusted.

Factors affecting the price of a product:

(i) Product Cost

(ii) Utility and Demand

(iii) Extent of competition in the market

(iv) Government and Legal Regulations

(v) Pricing Objectives

(vi) Marketing Methods used.

Detailed Answer:

Price is an element of marketing mix which refers to all important decisions relating to the fixation of the price of a product. Some factors that must be taken into consideration are:

(i) Production cost: The price should recover all costs viz. fixed costs, variable costs and semi- variable costs apart from obviously including a fair return for undertaking the marketing effort and risk.

(ii) Utility and demand: While determining the price of any product, the utility provided by it and the intensity of demand should not be ignored. If a buyer is satisfied that the given product meets his/ her requirement, he would also be ready to pay the cost and reasonable margin to the producer.

(iii) Extent of competition in the market: In case of monopoly, a firm can enjoy complete freedom in fixing prices. However, if it is facing competition, it should consider the prices charged by the competitors also.

(iv) Government and legal regulations: Government plays an important role in regulating the prices. For example, Life Saving Drugs, etc.

(v) Pricing objectives: Pricing objectives should be in accordance with the company objectives. Also, company/s objectives should be clear enough. In addition to profit maximization, pricing objectives may include (i) Obtaining market share leadership (ii) Surviving in a competitive market.

(vi) Marketing methods used: Pricing of products also gets affected by the elements of marketing such as amount spent on advertisement, type of packaging, discounting policies, credit or finance facilities etc.

1. Marketing Research:

• The first and foremost work in marketing is conducting a market research.
• Marketing research is a process of collecting information regarding scope of market, taste and preference of consumers, etc.
• A large company undergoes large scale production and has to bear high risk of success of the product or service. As a result, when the company wishes to produce some product it becomes necessary to gather knowledge regarding what a consumer wants in the product. Whether the consumer is ready to accept such a product and if yes then what price
• On the basis of such marketing research, information regarding demand, price, competition, etc. can be gathered.
• Methods to collect information include preparing questionnaire and getting it filled from people, observation, obtaining sales data from POS, etc.

2. Collection of product:

• In many cases products are manufactured at different places and they need to be collected centrally. This is known as collection of products.
• Similarly, even producers are scattered at several places. Also, some products are seasonally produced, some products are produced on a small scale and some products need further processing.
• In all these above scenarios, the products are to be collected at desired place for further processes.

3. Transformation of raw material into consumable products:

• Many products require further processing before selling them to general public.
• These unfinished products can be termed as raw material. The further processes on these raw materials make them consumable.
• While processing, care is taken that the final product meets the requirements of the consumers.
• For example, cereals and pulses are cleaned before packing for consumers. Similarly, raw fruits undergo specific ripening methods before sending them in fruit market.

4. Standardization and gradation:

• During the production, it is utmost important to standardize and grade the products.
• Standardization refers to a specific and nearly same colour, feel, size, quantity, etc. for every product or product lot.
• Gradation refers to grading the product on the basis of its quality and other characteristics. For example, fruits are graded as first quality fruit, second quality and so on.
• By grading the products into various categories, the producer can fix different prices for various grades and earn accordingly.
• Thus, products are standardized and graded side by side. Some products even require standardization by government agency.
• Product standardization and gradation helps in earning the faith and loyalty of consumers on the quality of the product.
• In India, AGMARK grades agricultural products whereas Bureau of Indian Standard (BIS) grades industrial products.

5. Labeling the products:

• A label differentiates the product of one producer from that of other competitors.
• Through label a unique identity gets created for the product. Once the label becomes famous the consumer easily identifies the product through that label. For example, Parle-G biscuit has maintained the colour and pattern of its packet
  since decades and consumers can easily recognize it even while watching it from a distance.
• Labels also help to prevent cheating of consumers through fake products. It is also easy for the company to advertise the product if it retains the label properly.
• Labeling also ensures product quality.

Brand and branding:

• Often, producer gives a name to the product he produces. This name is called brand name or simply brand. Brand name is kept on label of product. (Note: For example, Parle-G is the brand name of glucose biscuits that Parle company produces.)
• Brand can be in the form of name, symbol, number, producers name or a design.

6. Price determination: To determine the price, the producer needs to estimate various costs involved in the production.

• Some of these costs/expenses include production cost, product packing, insurance, distribution, advertisement, taxes and duties, discounts, etc.
• After calculating all these costs, the producer adds his profit component and determines the final sales price.
• While determining the price, the producer also considers demand for the product and price of the competitor’s product.
• Price determination should be done before packing because it is mandatory to print the price of the product on the pack.

7. Packing the product:

• Packing can be considered as the garment for the product.
• Packing does two tasks, providing protection to the product as well as attracting consumers. Depending on the type of product, the producer also prints details regarding the use of the product on the product.
• A variety of materials such as paper, plastic jars, tinned boxes, glass jar, etc. are used to pack different products.

Advantages of packaging:

• Proper packing prevents the goods from getting damaged and makes them easier to transport.
• Packing helps to preserve product quality and its features.
• Consumers easily come to know the price of the product from the packing itself (For example: We can easily make out that a wafer or kurkure pack is worth Rs. 10 without looking at the price.).

8. Storage of products:

• Products once produced do not necessarily get sold immediately.
• Products are put into market when the demand arises. It is important to build a balance between demand and supply of goods which in turn will enable better sales.
• Since, production is done on the basis of future demand, there arise the need of storing it.
• It is utmost important that during the storage the quality of the product does not deteriorate.

9. Transport service:

• As per the demand, the products are transported to required places.
• Different modes of transport such as roadways, railways, waterways and airways are used to ensure constant supply of raw materials and to enable finished product to reach the consumer.

10. Take insurance of the product:

• Numerous risks are associated while storing transporting the product. These risks include theft, fire, decoit, loss due to riots, sinking of product in water, etc.
• So, producers and distributors often insure their goods against such risks.
• Modern producers and distributors take different types of insurance like fire insurance, property insurance, accident insurance, marine insurance, riot insurance, etc.

11. Financial arrangement:

• Each and every activity of marketing requires money or say working capital.
• To satisfy these requirements well planned financial management is required.
• The financial manager decides how much finance to raise and allocate to the various activities.
• For certain seasonal product, advertisements are required in particular season only and so financial arrangement can be done well in advance.

Marketing manager’s main duties under marketing process includes:

• Avail finance at the right time
• Organize advertisement campaigns
• Set-up distribution channels
• Branding the product in the market
• Conducting market research, etc.

12. Advertisement:

• The strategy to advertise the product depends on the demand of the product as well as availability of finance.
• How the product has to be marketed depends on the type of product, strategy of advertisement of competitors and the effectiveness of media in creating demand for the product.
• Advertisement contributes towards creating demand for product. This is the reason why after advertising, the demand for such products and services increase.
• In most cases, advertisement campaign at local level proves to be more effective.

13. Sales and distribution system:

• Today’s consumer has several options and so he is impatient. As a result, it is essential that products reach the consumers speedily and economically.
• Producers appoint distributors at various regions to achieve this task. Now, in most cases producers distribute goods via. a centralized agency for an entire district or even a state and reduces the burden of the multilevel distribution.
• The sales and distribution network is created according to the type of product.
• If demand for products is very high and continuous in nature, then all the methods are adopted simultaneously.
• In distributorship, it is necessary that the products reach the wholesalers and retailers on time. In some cases, producers also sell products at the place of production (For example: Sale of processed Jams and pickles.)

14. Selling:

• The process in which the product is handed over to the consumer in exchange of money is called selling.
• The middleman plays a very important role in selling function.
• More aggressive distributors having good marketing skills can generate more sales.
• Quite often, the producer directly sells the product to the consumer. This mode of selling is the most effective form of selling.

15. After sales services:

• Marketing does not end at selling.
• After selling, the marketing function has to also take care that the consumers remain happy and loyal.
• For this, it listens to the complaints from consumers, provides facility of replacement of defective product, service and repair.
• Certain products require giving demonstration at the residence of consumers. Such products include air conditioners, television, washing machine, refrigerators, etc. The company needs to employ people having technical knowledge to do this task.
• The company also needs to create after sales service network to carry on service, repair/replacement and listen to complaints of the consumers.

Marketing:

Marketing may be defined as all activities that are facilitating the movement of goods and services from producer to the ultimate consumer.

Functions of Marketing:

1. Marketing Research: Marketing Research is a process of collecting and analysing market information to identify the needs and wants of the customers.

2. Marketing Planning:

Another function of marketing is to develop appropriate marketing plans so that the marketing objectives of the organisation can be achieved.

3. Product Designing and Development: 

The products are designed and developed according to the needs and wants of the consumers. It requires decision making on various aspects such as the product to be manufactured, its packing, selling price, quality of the product, etc. 

4. Standardisation and Grading: 

Standardisation refers to producing goods of predetermined specifications. Grading is the process of classification of products into different groups, on the basis of quality, size, etc.

5. Packaging and Labelling:

Packaging refers to designing and developing the package for the products. Packaging gives protection to goods. Also it attracts the consumers to buy the product. Labelling refers to designing and developing the label to be put on the package.

6. Branding: 

A brand is a name, term, sign, symbol, design or some combination of them, used to identify the products of one seller and to differentiate them from those of the competitors.

7. Customer Support Services: 

An important function of the marketing management is to develop customer support services such as after sales services, handling customer complaints, etc. which provides maximum satisfaction to the customers. 

8. Pricing:

Price of a product refers to the amount of money which customers have to pay to obtain a product. Price is an important factor affecting the success or failure of a product in the market. Price is fixed after taking into account the cost of production, desired profit, competitor’s price, govt, policy, etc.

9. Promotion:

Promotion of products and services involves informing the customers about the rm’s product, its features, etc. and persuading them to purchase these products. It includes Advertising, Personal Selling, Publicity and Sales Promotion.

10. Physical Distribution:

It includes decision regarding channels of distribution and physical movement of the product from the production centre to the consumption centre.

11. Transportation: 

Transportation involves physical movement of goods from one place to another. It removes the hindrance of place and creates time utility.

12. Storage or Warehousing:

In order to maintain smooth ow of products in the market, there is a need for proper storage of the products. It stabilizes the prices of products and keep the product without damage until they are sold.

1. Marketing Mix:

It refers to the combination of four basic marketing tools (Product, Price, Place and Promotion) that a rm uses to pursue its marketing objectives in a target market.

2. Elements / 4 P’s of Marketing Mix: 

1. Product:

Product means goods or services or ‘anything of value’, which is offered to the market for sale. The important product decisions include deciding about the features, quality, packaging, labelling and branding of the products.

2. Price:

Price is the amount of money paid by the customers to pay to obtain the product. In most of the products, price affects the demand of the products. Desired profits, cost of production, competition, demands, etc. must be considered before fixing the price of a product.

3. Place:

Place or Physical Distribution includes activities that make firm’s products available to the target customers. Important decision areas in this respect include selection of dealers, storage, warehousing and transportation of goods from the place of production to the place of consumption.

4. Promotion:

Promotion includes activities that communicate availability, features, merits, etc. of the products to the target customers and persuade them to buy it. It includes advertising, personal selling, sales promotion and publicity to promote the sale of products.

Quantity/number of products

1. Product:

Product may be defined as anything that can be offered to a market to satisfy a want or need. Products may broadly be classified into two categories. 

2. Elements: 

• Consumers products 
• Industrial products

Retailer or wholesaler.

Labelling means putting identification marks on the package. It is a simple tag attached to the product.

Functions of Labelling: 

1. It describes the product, its usage, cautions in use, etc. and specify its contents. 

2. It helps in identifying the product. 

3. It helps grading the products into different categories.

4. It helps in promotion of products. 

5. It provides information required by law.

Non personal paid form of sales promotion technique is Advertisement

Non personal non paid form of sales promotion technique is Publicity.

(d) Personal selling

Factors affecting pricing:

There are several factors that affect price determination. These are discussed below:

1. Production cost:

• Cost of producing a good that the producer has to bear is the most important of all aspects for determining the price.
• Production cost includes cost borne to procure raw material, labour, production and processing costs, administrative cost, sales and distribution expenses, etc.
• Over and above these costs, if the product is newly launched then there are also several other expenses incurred for promoting the product and putting up in the market. These costs also affect the price and can be considered indirect production cost.
• It is quite obvious that price of a product can never be lower than its production cost.

2. Demand for the product:

• Demand for the product and its price are directly related.
• Factors that affect demand include taste and preference of the consumer, number of consumers, purchasing power of consumer, number of competitors in the market, price of competitor’s product, etc.
• The producer may charge a high price if the demand is high, but if the demand is low, the price has to be kept low and competitive.
• In case if the product of competitor is in high demand or if there are more competitors in the market, the producer launching new product might have to lower its price.
• When the market is less competitive, the producer can keep a higher price and earn higher profit.

3. Competition in the market:

• The extent of competition directly affects the price of the product.
• Producers keeps competitive price when the number of competitors are more and competition is high.
• During competition, the prices are also fixed with objectives such as beating the competitor’s price, or making their entry or survival difficult in the market or even with an objective to force them to withdraw their product and quit the market.
• Contrary to this, a product having a very high brand reputation can be sold at higher price than the competitors’ product (Note: For example, iPhone).

4. Governmental and legal controls:

• Producers of monopolistic products (especially, of daily use) usually charge high price. So, the government imposes control on such business units in order to protect the interest of consumers.
• Prices of products like petrol keep on fluctuating quite frequently. Hence, the government puts a number of legal controls on such products. These factors have to be taken into consideration while determining product price.
• Government also imposes certain regulatory control on products which are essential for life such as lifesaving drugs, petrol, diesel, paper for daily newspaper, etc. So, the producers of these products have to consider these factors too while determining prices.

5. Price determination on the basis of objectives:

Over and above the factors discussed above, there are some other objectives too which the producer might consider while determining the price.

Some of them are:

(A) Maximum profit: Under this objective, the producer determines the price of the product with an aim of earning maximum profit. He does so either because there is no competition in the market or he has spent heavily in the research and development of the product.

(B) To acquire dominant position in the market: In most cases the producers keep a very low price of his product so that they can attract maximum customers and dominate the market.

(C) To sustain competition: When competitors are more and when competition is high, the business firms tend to fix prices lower than or at par with competitors.

6. Economic condition:

• Economic condition of the market plays an important role in determining the price of the product.
• If the economic condition of the country is good, price can be fixed at a higher level and if there is a recession, product price is reduced.

7. Buying behaviour:

• Consumer behavior plays an important role in determining price.
• Behaviour of consumers towards a product is affected by factors such as consumer’s habits, social and cultural structure, individual preference, his financial condition, etc.
• Due to these factors, the attitude towards the product may change and it may not get desired or expected response from the consumers. Hence, it is quite important to consider these factors too before determining the price.

Role (Functions) of advertisement:

1. Creates demand:

• Advertisement provides information about products to the consumers in the market.
• The information might be in the form of utility of the product, its features, how is it better than others, etc.
• All such information creates a sense of buying and using the product in the minds of people. This is how the demand of the product is created.
• Initially, people might buy the product on trial basis. Once they get used to it, they keep on demanding the product.

2. Benefit of large scale production:

• Advertisement can be targeted to a very large number of consumers at one go. This increases the demand many-folds.
• In order to meet the huge demand, the company has to undergo large-scale production. Large scale production reduces production cost and increases profitability.
• As a result, the company earns more return as compared to the advertisement cost.

3. Product awareness:

• Advertisement helps in providing information about the product to the consumer. The information can be utility of the product, features, how to use the product, etc.
• When a product has more than one usage then through advertisement such information is passed on to the potential consumers.
• Producer also creates a trust in consumer’s mind regarding the quality of the product.
• By sharing the trust and satisfaction of current consumers, new consumers can be convinced to purchase the product.
• Thus, there are several ways in which advertisement creates awareness about the product.

4. Helpful in employment generation:

• Due to advertisement, demand for a product or service increases. This leads to rise in employment in several sectors such as production, logistics, service and repair, etc.
• Also, severalemployment opportunities are created in the field of advertisement itself. This includes employment as copy writers, advertising distributors, film makers, artists, etc.

5. Betterment of standard of living: Advertisement creates awareness about new and innovative products in the market. Over and above fulfilling basic needs, consumers buy the products for living a comfortable life, a life where in their work can be done faster, and improve their standard of living.

6. Maintenance of quantum of sales:

• When a product is been advertised and repeated over and over several times, it creates a lasting impression and remembrance on the minds of consumers. This is the reason why at the time of purchase, consumer shows a prompt preference for these products.
• Such a policy of advertisement keeps sale at consistent level.
• In fact, products that are continuously advertised generate better sale than competitor’s products.

Marketing and selling are different.

Types of Channels:

1. Direct channel (Zero level): Producer → Consumer 

2. One level channel: Producer → Retailer → Consumer

3. Two level channel: Producer → Wholesaler → Retailer → Consumer 

4. Three level channel: Producer → Agent → Wholesaler → Retailer → Consumer

Answer is Yes.  Agree

It begins even before production of goods and continues even after the sale has taken place Marketing

According to modem marketing concept, the producer gives more importance to the tastes and needs of the consumer. The objective of modem marketing is maximum profit through consumer satisfaction. Now a days, producers produce products according to the needs of the customers. Consumer is the key to marketing and hence consumer is the king.

Functions of Marketing 

(1) Marketing Research :

Marketing Research is a process of collecting and analysing market information to identify the needs and wants of the customers.

(2) Marketing Planning :

Another function of marketing is to develop appropriate marketing plans so that the marketing objectives of the organisation can be achieved.

(3) Product Designing and Development: 

The products are designed and developed according to the needs and wants of the consumers. It requires decision making on various aspects such as the product to be manufactured, its packing, selling price, quality of the product, etc.

(4) Standardisation and Grading:

Standardisation refers to producing goods of predetermined specifications. Grading is the process of classification of products info different groups, on the basis of quality, size, etc.

(5) Packaging and Labelling :

Packaging refers to designing and developing the package for the products. Packaging gives protection to goods. Also it attracts the consumers to buy the product. Labelling refers to designing and developing the label to be put on the package.

(6) Branding:

A brand is a name, term, sign, symbol, design or some combination of them, used to identify the products of one seller and to differentiate them from those of the competitors.

(7) Customer Support Services :

An important function of the marketing management is to develop customer support services such as after sales services, handling customer complaints, etc. which provides maximum satisfaction to the customers.

(8) Pricing :

Price of a product refers to the amount of money which customers have to pay to obtain a product. Price is an important factor affecting the success or failure of a product in the market. Price is fixed after taking into account the cost of production, desired profit, competitor’s price, govt, policy, etc.

(9) Promotion :

Promotion of products and services involves informing the customers about the rm’s product, its features, etc. and persuading them to purchase these products. It includes Advertising, Personal Selling, Publicity and Sales Promotion.

(10) Physical Distribution :

It includes decision regarding channels of distribution and physical movement of the product from the production centre to the consumption centre.

(11) Transportation:

Transportation involves physical movement of goods from one place to another. It removes the hindrance of place and creates time utility. 

(12) Storage or Warehousing :

In order to maintain smooth ow of products in the market, there is a need for proper storage of the products. It stabilizes the prices of products and keep the product without damage until they are sold.

Rebate of discount or offers.

(i) Rebate

(ii) Refund

(iii) Product combination

(iv) Quantity gift

(v) Instant draws and assigned gifts

(vi) Usable Benefits

(i) Rebate: Offering products at special prices, to clear off excess inventory is known as rebate.

(ii) Refunds: In this case, the seller offers to refund a part of the price paid by the customer on the production of some proof of purchase. For example, refund of Rs.5 on the presentation of an empty pack of Maggie noodles.

(iii) Product Combinations: The customer is given another product as a free gift along-with the purchase of certain goods. For example, gift of microwave oven with the purchase of Burner Hob by Sunflame or a gift of Trolley with the purchase of Inverter by Luminous.

(iv) Quantity Gifts: Sometimes sellers devise special package, which gives extra quantity of the product to the buyer at lesser price or at no price. For example, buy two soaps and get one free by LUX.

(v) Instant draws and assigned gifts: Some gifts are given on the basis of draws or some events. For example, scratch a card and win a gold locket on the purchase of a TV

(vi) Usable benefits: Gifts are given to the users of the product. For example, purchase goods worth Rs.3,000 and get a holiday package worth Rs.2,000 free.

‘Instant draw and assigned gift’ is the name of it.

(1) Quantity Gift:

Offering extra quantity of the product. 

(2) Contests :

Prize contests are organized for the consumers and winners are given attractive prizes.

(3) Money refund :

There are certain manufacturers who promise to refund the price of the product, if it does not satisfy the consumer. 

(4) Samples :

Offer of free samples of a product to customers at the time of introduction of a new product.

(c) Sales promotion

There are various techniques of promoting the sale.

Some of these are discussed below: 

1. Sale: When the product is genuinely offered at lower price than its actual price for a limited period of time, it is known as sale. Generally, such technique is used by business units to reduce closing stock.

2. Discount: When actual price charged for a product is less than its original price it is known as discount. Discount is mostly offered for products that are slightly defective. This attracts a large number of customers.

3. Advertisement coupon:

• A coupon printed in newspaper or circulated through pamphlet or some other modes where in the consumer is given discount on producing the coupons to the seller is called an advertisement coupon.
• There are two objectives of advertisement coupons, first to check how well is the sale response by offering such coupons and second to provide discount to the one who produces the coupons to the seller.

4. Gift:

• Sometimes a small gift is given along with the main product. For example, giving 1 soap free on purchasing 3 soap bars.
• Sometimes the producer gives more quantity for the same price as a part of gift. For example, giving 20% more detergent at the same price.

5. Additional gift:

• The producer assesses the needs of the consumers and offers additional gifts along with the main product to lure them. For example, giving toothbrush free on purchase of a toothpaste.
• Sometimes, product not related with the main product is also given as a gift. For example, offering a toy as a gift in a snack pack.

6. Lucky draw: In this technique the customer is given a coupon as a code and on a particular day results are declared. The person whose coupon number gets selected in the lucky draw gets a gift. For example, Bharat petroleum gives prize winning coupons on buying of petrol of ^200/- or more.

7. Facility of interest-free loans:

• Interest-free loan is a loan where in the consumer who buys a product on loan does not need to pay interest.
• This technique is used when the product is high priced and the customer cannot afford to pay the amount all together. For example, interest-free loans is given for purchasing T.V., refrigerators, 2-wheelers, etc.
• In such type of loans, the consumer can take the product to his house after paying a small payment known as down-payment. He needs to pay the balance amount in the form of monthly installments which are interest-free.
• Since, no interest is charged, the consumer gets easily attracted and motivated to purchase the product.

8. Distributing samples:

• Sometimes, small samples are distributed to people so that they can check the product and purchase if they like it.
• Sellers distribute samples of shampoo, soap, oil, pickles, jam, etc. in small sachet.

9. Organizing competitions: In this concept, during the new product launch, the producers organize competition in order to promote their new product. For example, the company making crayons for children would collect information about the customer by organizing drawing competition for them before launching new colours in the market. Here the winner gets the new product as a prize.

Correct option is (A) The customer gets inspired to buy the product quickly

1. Consumers’ products:

Products, which are purchased by the ultimate consumers for satisfying their personal needs and wants are referred to as consumer products. Consumer products are classified as

Shopping efforts involved Durability of products 

2. Industrial Products:

Industrial products are those products, which are used as inputs in producing other products. The examples of such products are raw materials, engines, lubricants, machines, tools, etc. 

Types of industrial products: 

1. Materials and Parts – 

These include goods that enter the manufacture’s products completely.

2. Capital Items – 

These goods are used in the production of finished goods.

3. Supplies and Business Services – 

These are short lasting goods and services that facilitate developing or managing the finished product.

The name of this technique is ‘Rebate’. Under it, in order to clear the excess stock products are offered at reduced prices.

Two other techniques are given below:

i. Full Finance @ 0%: Under this method, the product is sold and money is received in instalments at 0% rate of interest. The seller determines the number of instalments in which the price of the product will be recovered from the customer. No interest is received on these instalments.

ii. Samples or Sampling: Under this method, the producer distributes free samples of his product among the consumers. Sales representatives distribute these samples from door-to-door. This method is used mostly in case of products of daily-use, e.g., Washing Powder, Tea, Toothpaste, etc. Thus, the consumers willy-nilly make use of free sample. If it satisfies them, they buy it and in this way sales are increased.